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Department of the Treasury

Community Development

Financial Institutions Fund

Congressional Budget

Justification and Annual

Performance Report and Plan

FY 2019

CDFI Fund - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement ................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .......................................................................................... 4

1.3 – Operating Levels Table ...................................................................................................... 5

C – Appropriations Language and Explanation of Changes ....................................................... 6

D – Legislative Proposals ........................................................................................................... 6

Section II – Annual Performance Plan and Report ................................................................... 7

A – Strategic Alignment ............................................................................................................. 7

B – Budget and Performance by Budget Activity ...................................................................... 8

2.1.1 Administration- Resources and Measures ......................................................................... 8

2A - Administration .................................................................................................................... 8

2.1.2 – Community Development Financial Institutions Program Resources and Measures ..... 9

2B - Community Development Financial Institutions Program ................................................. 9

2.1.3 – New Markets Tax Credit Program Resources and Measures ....................................... 10

2C – New Markets Tax Credit Program ................................................................................... 10

2.1.4 – Bank Enterprise Award Program Performance and Measures ..................................... 12

2D – Bank Enterprise Award Program ..................................................................................... 12

2.1.5 – Native American CDFI Assistance Program Performance and Measures.................... 13

2E – Native American CDFI Assistance Program .................................................................... 13

2.1.6 - Healthy Food Financing Initiative Performance and Measures .................................... 14

2F – Healthy Food Financing Initiative .................................................................................... 14

2.1.7 - Capital Magnet Fund Program Resource Detail Table .................................................. 15

2G - Capital Magnet Fund Program .......................................................................................... 15

2.1.8 - Bond Guarantee Program Resource Detail Table.......................................................... 15

2.1.9 - Financing Accounts – Non-Budgetary Summary .......................................................... 16

2H - CDFI Bond Guarantee Program ....................................................................................... 16

Section III – Additional Information ........................................................................................ 17

A – Summary of Capital Investments ....................................................................................... 17

Non-Major IT Investments ....................................................................................................... 17

IT Infrastructure Investments .................................................................................................... 17

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Section I – Budget Request

A – Mission Statement

To expand economic opportunity for underserved people and communities by supporting the

growth and capacity of a national network of community development lenders, investors and

financial service providers.

B – Summary of the Request

The Community Development Financial Intuitions (CDFI) Fund supports Treasury’s Strategic Goal

1 (Boost U.S. Economic Growth) and Strategic Goal 4 (Transform Government-wide Financial

Stewardship). The Budget requests the following for the CDFI Fund for FY 2019:

$14 million in administrative funding to support:

- Management of the CDFI, Bond Guarantee (BG), and New Markets Tax Credit (NMTC)

Programs; and

- Ongoing certification and compliance monitoring for all programs, including the Bank

Enterprise Award (BEA) Program, the CDFI Program, the Native American CDFI

Assistance (NACA) Program, and the Healthy Food Financing Initiative (HFFI).

The Budget eliminates funding for the CDFI Fund’s four discretionary grant and direct loan

programs (i.e. the CDFI Program, the BEA Program, the NACA Program, and HFFI) and

proposes to extend the CDFI BG Program, which offers CDFIs low-cost, long-term financing

at no cost to taxpayers. The Budget also includes a proposal to eliminate new funding for

Capital Magnet Fund (CMF) effective in 2019.

- The CDFI BG Program provides CDFIs access to capital by providing guarantees of

bonds issued by Qualified Issuers. CDFIs invest the bond proceeds into our nation’s

most distressed communities. CDFIs benefit by accessing long-term credit at below-

market interest rates. The BG Program incentivizes and empowers CDFIs to execute

large-scale projects, including the development of charter schools, commercial real

estate, rental housing, senior living, daycare or healthcare centers, small businesses, and

rural infrastructure, among others. The program requires no credit subsidy.

- The Budget proposes an annual commitment authority of $500 million and program

changes to (1) reduce the minimum bond issue size from $100 million to $50 million; and

(2) correct a technical drafting error related to the calculation of the relending account

maximum.

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1.1 – Appropriations Detail Table Dollars in Thousands Community Development Financial Institutions Fund

FY 2017 FY 2018 FY 2019 FY 2018 to FY 2019

Appropriated Resources Enacted** Annualized CR Request Change % Change

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Community Development Financial Institutions Program

0 $161,500 0 $160,403 0 $0 0 ($160,403) NA -100.00%

Bank Enterprise Award Program 0 $23,000 0 $22,844 0 $0 0 ($22,844) NA -100.00%

Native American CDFI Assistance Program

0 $15,500 0 $15,395 0 $0 0 ($15,395) NA -100.00%

Administration 74 $26,000 74 $25,823 42 $14,000 (32) ($11,823) -45.45% -45.78%

Healthy Food Financing Program 0 $22,000 0 $21,851 0 $0 0 ($21,851) NA -100.00%

Subtotal New Appropriated Resources

74 $248,000 74 $246,316 42 $14,000 (32) ($232,316) -45.45% -94.32%

Other Resources

User Fees * 0 $415 0 $700 0 $1,000 0 $300 NA 42.86%

Recovery From Prior Years 0 $642 0 $3,400 0 $2,500 0 ($900) NA -26.47%

Unobligated Balances Brought Forward

0 $28,312 0 $32,606 0 $5,000 0 ($27,606) NA -84.67%

Subtotal Other Resources 0 $29,369 0 $36,706 0 $8,500 0 ($28,206) NA -76.84%

Total Budgetary Resources 74 $277,369 74 $283,022 42 $22,500 (32) ($260,522) -45.45% -92.05%

* FY 2017 User Fees reflects authorization of the Bond Guarantee Program. ** This column reflects levels appropriated in H.R. 255, the Consolidated Appropriations Act of 2017. For further details on the execution of these resources see the 2019 Budget Appendix chapter for the Department of the Treasury. FY 2017 FTE employment level reflects actuals, and the $ amount represents 2017 Enacted.

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1.3 – Operating Levels Table

Dollars in Thousands

Community Development Financial Institutions Fund FY 2017 FY 2018 FY 2019

Object Classification Enacted1 Annualized CR Request

11.1 – Full-time permanent 9,085 9,382 4,589

11.9 – Personnel Compensation (Total) 9,085 9,382 4,589

12.0 – Personnel benefits 2,991 3,067 2,160

Total Personnel and Compensation Benefits $12,076 $12,449 $6,749

21.0 – Travel and transportation of persons 59 40 15

24.0 – Printing and reproduction 11 5 1

25.1 – Advisory and assistance services 5,707 2,551 0

25.2 – Other services from non-Federal sources 38 15 15

25.3 –Other goods and services from Federal sources 4,420 6,908 5,212

25.7 – Operation and maintenance of equipment 0 2,967 2,003

26.0 – Supplies and materials 42 35 5

31.0 – Equipment 3,647 853 0

41.0 – Grants, subsidies, and contributions 222,000 220,493 0

Total Non-Personnel $235,924 $233,867 $7,251

New Budgetary Resources $248,000 $246,316 $14,000

FTE 74 74 42

Note: This table includes total annually appropriated funding (FY 2017 Enacted, FY 2018 Annualized CR, and FY 2019 Request). 1This column reflects levels appropriated in H.R. 255, the Consolidated Appropriations Act of 2017. For further details on the execution of these resources see the 2019 Budget Appendix chapter for the Department of the Treasury. FY 2017 FTE employment level reflects actuals, and the $ amount represents 2017 Enacted.

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C – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of

Changes

DEPARTMENT OF THE TREASURY

COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS

FUND

To carry out the Riegle Community Development and Regulatory

Improvements Act of 1994 (subtitle A of title I of Public Law 103–

325), including services authorized by section 3109 of title 5,

United States Code, but at rates for individuals not to exceed the

per diem rate equivalent to the rate for EX-3, $14,000,000, to be

used for administrative expenses, including administration of

CDFI fund programs and the New Markets Tax Credit Program:

Provided, That during fiscal year 2019, none of the funds available

under this heading are available for the cost, as defined in section

502 of the Congressional Budget Act of 1974, of commitments to

guarantee bonds and notes under section 114A of the Riegle

Community Development and Regulatory Improvement Act of 1994

(12 U.S.C. 4713a): Provided further, That commitments to

guarantee bonds and notes under such section 114A shall not

exceed $500,000,000 through December 31, 2019: Provided

further, That such section 114A shall remain in effect until

December 31, 2019.

Note.—A full-year 2018 appropriation for this account was not

enacted at the time the budget was prepared; therefore, the budget

assumes this account is operating under the Continuing

Appropriations Act, 2018 (Division D of P.L. 115-56, as

amended). The amounts included for 2018 reflect the annualized

level provided by the continuing resolution.

Extension of the Bond

Guarantee Program

through December 31,

2019 to allow more time

to close complex and

time-consuming bond

commitments.

D – Legislative Proposals

The Budget requests extension of the CDFI Bond Guarantee Program through December 31,

2019 and elimination of new allocations into the Capital Magnet Fund effective in FY 2019.

Legislative Language

SEC. 126. AMENDMENTS TO COMMUNITY DEVELOPMENT FINANCIAL

INSTITUTIONS BOND PROGRAM. Section 114A of the Riegle Community Development and

Regulatory Improvement Act of 1994 (12 U.S.C. 4713a) is amended— (a) in subsection (c)(2)

by striking ", multiplied by an amount equal to the outstanding principal balance of issued notes

or bonds"; and (b) in subsection (e)(2)(B), by striking "$100,000,000" and inserting

"$50,000,000".

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Section II – Annual Performance Plan and Report

A – Strategic Alignment

The CDFI Fund’s mission is to expand economic opportunity for underserved people and

communities by supporting the growth and capacity of a national network of community

development lenders, investors, and financial service providers. The CDFI Fund supports the

following Treasury’s FY 2018-2022 strategic goals:

Goal 1: Boost U.S. Economic Growth

o Objective 1.2 – Strong Economic Fundamentals

Goal 4: Transform Government-wide Financial Stewardship

o Objective 4.1 – Financial Data Access and Use

The CDFI Fund’s award recipients provide loans, investments, business counseling, basic

banking services, and financial literacy training in some of the most distressed communities in

the nation. These are the communities where job opportunities remain stagnant and that

otherwise lack access to more mainstream forms of capital – the places in the United States that

are not progressing economically as other parts of our economy have improved. CDFI Fund

award recipients use their awards to increase access to capital and help to improve the quality of

life and the local economy in these communities.

The CDFI Fund has articulated five goals in its FY 2018-2022 Strategic Plan aimed at increasing

the impact of the CDFI Fund network by supporting the growth, reach, and performance of CDFI

Fund awardees. These goals support Treasury’s strategic plan to: promote strong economic

fundamentals; transform government-wide financial stewardship; and ensure financial data

access/use.

The FY 2019 Budget will advance these goals by allowing the CDFI Fund to administer and

fully staff the CDFI Fund’s programs that are authorized by Congress but do not require

appropriated funds to make awards, i.e., the NMTC Program and CDFI BG Program. In

addition, the CDFI Fund will continue to conduct ongoing program compliance for prior-year

award recipients for all programs.

The budget request is also intended to cover the cost to administer certification of CDFIs, as

required by the Riegle Act, as well as Community Development Entities (CDEs), as required by

the NMTC program. CDFI certification is a prerequisite for eligibility for the BG Program and

the Capital Magnet Fund (CMF), as well as other federal programs outside of the CDFI Fund.

CDE certification is a prerequisite for eligibility for the NMTC program.

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B – Budget and Performance by Budget Activity

2.1.1 Administration- Resources and Measures Dollars in Thousands

Resource Level FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Actual Actual Actual Actual Enacted Annualized

CR Request

Appropriated Resources $21,764 $24,636 $23,100 $23,600 $26,000 $25,823 $14,000

Budget Activity Total $21,764 $24,636 $23,100 $23,600 $26,000 $25,823 $14,000

FTE 76 76 76 77 74 74 42

Measure FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2017 FY 2018 FY 2019

Actual Actual Actual Actual Actual Target Target Target

ALL - Award Cycle Time (Months) 6.8 7.9 8.3 7.6 6.3 7.0 7.0 7.0

All - Time to Initial Disbursement (# Months)

N/A N/A N/A B N/A N/A 4.5 4.5

ALL - Number of Affordable Housing Units Developed or Produced

26,391 32,621 27,004 35,251 27,443 28,000 28,000 28,000

Key: B - Baseline

2A - Administration

($14,000,000 from direct appropriations):

This encompasses the CDFI Fund’s operational support and management activities for each of its

ongoing award programs. It includes, among other activities, developing notices of award

availability and application materials; reviewing and evaluating certification and award

applications; selecting awardees; finalizing the terms of award agreements; making

disbursements; collecting and evaluating performance data; monitoring awardees’ compliance;

and award closeout processes.

Description of Performance:

The CDFI Fund’s two administrative measures are organization-wide efficiency measures based

on how quickly awards are made and funds are disbursed.

The All Cycle Time measures the average time from the date when applications are received

to the date of award announcement (calculated in months as an average across all programs).

In FY 2017, the 7 month cycle-time target was met because it took on average only 6.3

months to make the awards. This achievement reflects improved efficiency in making

awards, which is largely a function of the implementation of the Awards Management and

Information system (AMIS).

The Time to Initial Disbursement is a new measure that indicates in months how quickly the

CDFI Fund completes award agreements and makes the first disbursement of funds or issues

tax credits. The results for FY 2017 have not yet been tabulated because this measure cannot

be computed until 4.5 months have elapsed after the end of FY 2017.

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The Number of Affordable Housing Units Developed or Produced measure captures the

number of affordable housing units developed or produced as a result of CDFI Fund

awards as reported by CDFI, NMTC, and CMF Program awardees and allocation

recipients. The FY 2017 actual result of 27,433 affordable housing units was slightly

below the target of 28,000 affordable housing units. The FY 2018 target remains 28,000

units, and it reflects projected outcomes for program investments from prior-year award

recipients’ reported eligible affordable housing projects.

2.1.2 – Community Development Financial Institutions Program Resources and Measures Dollars in Thousands


CDFI Program Budget Activity

Actual Actual Actual Actual Actual Annualized

CR Request

Appropriated Resources

$138,397 $146,364 $152,400 $153,423 $161,500 $160,403 $0

Budget Activity Total $138,397 $146,364 $152,400 $153,423 $161,500 $160,403 $0



CDFI - Percentage of Loans & Investments Originated in Eligible Distressed or Underserved Communities by Dollar Amount of Loans (Annual %)

77.1 70.8 80.1 80.9 81.2 60.0 60.0 N/A

CDFI - Percentage of Loans & Investments Originated in Eligible Distressed or Underserved Communities by Number of Loans

79.6 60.7 80.5 81.5 83.0 60.0 60.0 N/A

2B - Community Development Financial Institutions Program

($0 from direct appropriations):

The CDFI Program makes Financial Assistance (FA) awards to CDFIs that have comprehensive

business plans for creating community development impact and that demonstrate the ability to

leverage private sector sources of financing, as well as Technical Assistance (TA) grants to

CDFIs and entities proposing to become CDFIs. CDFIs use FA awards to further goals such as:

Economic development (job creation, business development, and commercial real estate

development);

Affordable housing (rental housing and homeownership); and

Financial services (provision of basic banking services and financial literacy training to

underserved people and communities).


The CDFI Program has two measures: (1) the percentage of loans and investments originated in

eligible distressed communities or made to underserved populations, as measured against the

total dollar amount of loans originated by awardees; and (2) the percentage of loans and

investments originated in eligible distressed communities or to underserved populations, as

measured against the total number of loans originated by awardees.

CDFI Fund - 10

Certification criteria require that all certified CDFIs originate at least 60.0 percent of their loans

and investments in eligible distressed census tracts or to underserved populations. The target is

set at a level that allows CDFIs to balance their mission to serve distressed communities and

underserved populations with their safety and soundness considerations.

In FY 2017, the CDFI Program surpassed the 60.0 percent threshold for the percentage of both

the dollar amount (81.2 percent) and the number of CDFI loans (83.0 percent) made to eligible

distressed communities and underserved populations. The FY 2018 target remains 60.0 percent

to ensure that CDFIs can balance mission with safety and soundness objectives.

2.1.3 – New Markets Tax Credit Program Resources and Measures Dollars in Thousands


New Markets Tax Credit Budget Activity


CR Request

Appropriated Resources $0 $0 $0 $0 $0 $0 $0

Budget Activity Total $0 $0 $0 $0 $0 $0 $0



NMTC - Percentage of Loans and Investments That Went Into Severely Distressed Communities

78.5 73.8 75.2 74.5 77.5 74.0 75.0 75.0

2C – New Markets Tax Credit Program

($0 from direct program appropriations):

The NMTC Program stimulates capital investment in low-income communities nationwide by

permitting individual and corporate taxpayers to receive a non-refundable tax credit against

federal income taxes for making equity investments in vehicles known as CDEs. CDEs that

receive the tax credit allocation authority under the program are domestic corporations or

partnerships that provide loans, investments, or financial counseling in low-income urban and

rural communities.

On December 18, 2015, Congress extended the authorization of the NMTC Program for

$3.5 billion per year through 2019.


The Calendar Year (CY) 2015 and CY 2016 NMTC allocation authority was allocated in

November 2016 as a combined round, in which the NMTC Program awarded $7 billion in

NMTC allocation authority to 120 CDEs, out of a pool of 238 applicants requesting $17.6

billion.

In FY 2017, 77.5 percent of NMTC investments were made in severely-distressed communities,

exceeding the target by more than three percentage points. This performance indicates that

CDEs continue to meet their commitments in severely-distressed communities. Because the

trend data indicates improvement, the CDFI Fund has elevated the FY 2018 and FY 2019 targets

to 75 percent.

CDFI Fund - 11

In August 2017, the CDFI Fund released the Compliance Review of New Markets Tax Credit

Program1 report commissioned by the CDFI Fund and conducted by Summit Consulting, LLC.

The independent report examines whether NMTC recipients have complied with program

requirements and if recipients’ “investment activities have aligned with the objectives of the

NMTC Program.” The report emphasizes the NMTCs are being used as Congress intended – to

attract private investment into projects in economically-distressed communities – and documents

the ways CDEs are meeting and generally exceeding NMTC Program requirements.

The report addresses questions and recommendations posed by the Government Accountability

Office regarding the distribution of benefits among the NMTC Program’s stakeholders,

investors’ rates of return, and the role that other public investments play in NMTC investments.

Among the report’s key findings are:

CDEs often go beyond compliance requirements, providing more flexible capital and

investing in more highly-distressed areas than the NMTC Program requires;

The flexible financing provided by CDEs reduces the net cost of capital for borrowers; and

Many CDEs use a rigorous project selection process that included a “but-for analysis,”

community benefit considerations, and advisory board involvement.

A review of NMTC projects showed that approximately two-thirds received public funding

consistent with financing gaps. The remaining one-third revealed that projects located in highly

distressed areas may need more public funding to attract private investment to enhance

community benefits or to support initial project operating costs.

1 https://www.cdfifund.gov/Documents/Summit%20-

%20Compliance%20Review%20of%20New%20Markets%20Tax%20Credit%20Program%20-

%20August%20Date%20-%20508%20Compliant.pdf

https://www.cdfifund.gov/Documents/Summit%20-%20Compliance%20Review%20of%20New%20Markets%20Tax%20Credit%20Program%20-%20August%20Date%20-%20508%20Compliant.pdf



CDFI Fund - 12

2.1.4 – Bank Enterprise Award Program Performance and Measures Dollars in Thousands


Bank Enterprise Award Program Budget Activity


CR Request

Appropriated Resources $17,058 $18,000 $18,000 $19,000 $23,000 $22,844 $0




BEA - Increase in Community Development Activities Over Prior Year For All BEA Program Applicants ($ million)

493.5 723.5 759.9 539 TBD 500 500 N/A

2D – Bank Enterprise Award Program


The BEA Program provides monetary awards to regulated banks and thrifts for increasing their

investments in CDFIs through grants, stock purchases, loans, deposits, and other forms of

financial and technical assistance, and for increasing their lending, investment, and service

activities in economically-distressed communities where at least 30 percent of residents have

incomes less than the national poverty level and where the unemployment rate is at least 1.5

times the national unemployment rate.


The BEA Program measures applicants’ increase in qualified community development activities

over the prior year. In FY 2017, the CDFI Fund awarded $18.6 million from the FY 2016

appropriated BEA Program funds. The award round for FY 2017 opened in September 2017,

with award announcements expected to be made in April 2018.

The performance target for the FY 2016 round was met. BEA program applicants documented

$539 million in increased qualified community development activities, exceeding the target of

$450 million.

In June 2017, the CDFI Fund released the Bank Enterprise Award Program Baseline Analysis

and Evaluation2 report, which is an independent third-party evaluation of the BEA Program.

The report found that the BEA Program targets census tracts with much lower income levels and

higher poverty rates than are typically required under the Community Reinvestment Act (CRA).

In addition, applicants and awardees surveyed during the BEA Program evaluation indicated

program awards mitigate the financial risks and costs of operating bank branches in highly-

distressed communities and are a factor in shaping the financial products and services offered in

these communities. The report’s analysis shows that CDFI banks and CDFIs generally lend at a

greater frequency in highly distressed communities than CRA-reporting banks, and that BEA

awardees typically originate a larger share of their loans in persistent-poverty areas than CRA-

reporting banks. The evaluation also found that the BEA Program has evolved over time, and it

2 https://www.cdfifund.gov/news-events/news/Pages/news-detail.aspx?NewsID=260&Category=Press%20Releases

https://www.cdfifund.gov/news-events/news/Pages/news-detail.aspx?NewsID=260&Category=Press%20Releases

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now focuses on providing awards to smaller CDFI banks that increase their activities in

distressed communities, as well as to larger non-CDFI banks that invest in CDFIs to reach more

highly distressed areas than they otherwise would.

2.1.5 – Native American CDFI Assistance Program Performance and Measures Dollars in Thousands


Native American CDFI Assistance Program


CR Request





NACA - Percentage of NACA Loans and Investments in Native Areas ($ Amount of Loans)

75.5 57.9 65 61.2 42.6 50.0 50.0 N/A

NACA - Percentage of NACA Loans and Investments in Native Areas (# of Loans)

93.3 87 95.9 96.3 94.5 50.0 50.0 N/A

2E – Native American CDFI Assistance Program


Through the NACA Program, the CDFI Fund assists entities in overcoming barriers that prevent

access to credit, capital, and financial services in American Indian, Alaska Native, and Native

Hawaiian communities. The NACA Program makes monetary awards to increase the number

and capacity of existing or new Native CDFIs (i.e., CDFIs that serve Native communities). In

addition, the NACA Program provides training to help strengthen and develop Native CDFIs.

Native CDFIs lend where other mainstream financial institutions have not and serve the poorest

individuals, families, and businesses in Native communities.


In FY 2016, two new measures of performance were approved for the NACA Program: (1) the

percentage of the number of loans, and (2) the dollar amount of loans, made in tribal lands

(based on Federal Designations of Tribal areas) or to Native people. In accordance with their

Financial Assistance agreements, NACA awardees are required to originate 50.0 percent or more

of their loans and investments in Native areas or to Native populations. This threshold is set to

allow the awardees to balance their mission of serving Native areas and populations with safety

and soundness considerations.

These two measures were first baselined in FY 2017 with outcome data from 2016. It showed

that 61 percent of dollars originated, and over 96 percent of the number of loans originated, were

in Native Areas or to Native borrowers. The preliminary data for FY 2017 reflects a shortfall in

the dollar amount of loans originated – just 42.6 percent – but the target for the percent of loans

was exceeded, with performance of 94 percent. The preliminary data is incomplete due to late-

filed reports. Based on past reporting patterns, the CDFI Fund expects that complete data will

show a higher percentage of the dollar amount of loans originated. Enhanced compliance

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monitoring procedures and improvements in the performance reporting systems should mitigate

these reporting problems in the future. The target for FY 2018 remains 50 percent.

2.1.6 - Healthy Food Financing Initiative Performance and Measures

Dollars in Thousands


Healthy Food Financing Initiative


CR Request





HFFI - Retail Outlets Created/Preserved 31 33 35 19 24 20 20 N/A

2F – Healthy Food Financing Initiative


The Healthy Food Financing Initiative (HFFI) aims to eliminate “food deserts” – low-income

urban and rural areas in the United States with limited access to affordable and nutritious food –

by financing interventions that expand the supply of, and demand for, nutritious foods. The

objectives include increasing the distribution of agricultural products, developing and equipping

grocery stores, and strengthening producer-to-consumer relationships.

Through the HFFI, the CDFI Fund awards CDFI Program funds to certified CDFIs to help

address the need for healthy food in underserved and low-income communities. These

organizations use federal grants, below market-rate loans, loan guarantees, and tax credits to

attract private sector financing for projects that increase access to healthy food options.


The primary HFFI performance measure is the number of healthy food retail stores created and

maintained in low-income areas that have been identified through detailed census tract analysis

as having limited access to healthy food options. In FY 2017, the number of HFFI Retail outlets

created was 24. Under the current continuing resolution, the target is 20 new retail outlets for

FY 2018.

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2.1.7 - Capital Magnet Fund Program Resource Detail Table Dollars in Thousands


Capital Magnet Fund Program


CR * Request

GSE Distribution NA NA NA $100,292 $119,413 $0 $0

Budget Activity Total $0 $0 $0 $100,292 $119,413 $0 $0

FTE 0 0 0 0 7 7 0

* The Budget assumes no funds will be provided to the CMF in 2018 in accordance with the Federal Housing Finance Agency's 2014 stated policy that funds will not be transferred if the transfer would cause the GSEs to draw on the Treasury funding commitment under the Preferred Stock Purchase Agreements (PSPAs). The Budget anticipates that such a draw will occur in 2018 as a result of the enactment of tax reform legislation.

2G - Capital Magnet Fund Program


The CMF program was authorized by the Housing and Economic Recovery Act of 2008, which

calls for recurrent funding of the CMF through allocations from the Government-Sponsored

Enterprises (GSEs) Fannie Mae and Freddie Mac. Through CMF, the CDFI Fund provides grants

to CDFIs and qualified non-profit housing organizations to finance affordable housing, community

service facilities, and economic development. Award recipients can use funds to create financing

tools such as loan loss reserves, revolving loan funds, risk-sharing loans, and loan guarantees. The

Budget proposes to suspend new allocations into the CMF effective in FY 2019.


The primary performance measures of the CMF are the number of affordable housing units for

which CMF funding was a source of financing, and the degree to which private funding sources

were leveraged by CMF financing. Data are included in performance table 2.1.1 above.

Awardee reports available through September 30, 2017, indicate that the total number of

affordable homes under development or completed with CMF financing, through the end of the

awardees’ FY 2016 were:

13,325 affordable homes under development or completed with CMF financing (a net

addition of 2,430)

o Affordable rental homes financed: 11,727 (a net addition of 2,220)

o Affordable homeowner-occupied homes financed: 1,598 (a net addition of 210)

Leverage: 1:20 (This ratio does not include leverage from the reinvestment of funds. The

target set by Congress was 10 times leveraging.)

2.1.8 - Bond Guarantee Program Resource Detail Table Dollars in Thousands


Bond Guarantee Program Actual Actual Actual Actual Actual Annualized

CR Request

Obligations $325,000 $200,000 $327,000 $265,000 $260,000 $500,000 $500,000

Loan Limitation Obligation Authority

$1,000,000 $750,000 $750,000 $750,000 $500,000 $500,000 $500,000

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2.1.9 - Financing Accounts – Non-Budgetary Summary Dollars in Thousands


Actual Actual Actual Actual Actual Anualizd

CR Request

Obligations $325,000 $200,000 $327,000 $265,000 $260,000 $500,000 $500,000

Collections* $0 $356 $2,966 $9,377 $20,927 $44,720 $72,310

*Includes the principal and interest repayments and a 10 basis point fee for administrative expenses pursuant to Section 1134 of the Small Business Jobs Act of 2010. These amounts assume a zero subsidy rate with bond loan disbursement of $456 million and $427 million, in FY 2018 and FY 2019, respectively.

2H - CDFI Bond Guarantee Program

Through the CDFI Bond Guarantee Program, Treasury provides a 100 percent guarantee of

bonds (including principal, interest, and call premiums) issued by Qualified Issuers. Bonds

issued through the program support CDFI lending and investment activity in underserved

communities by providing a source of long-term capital. Qualified Issuers use bond proceeds to

finance loans to eligible CDFIs for community and economic development purposes.

Since the inception of the program, the total amount of bonds guaranteed is $1.362 billion. A

total of 26 Eligible CDFIs and three Qualified Issuers participate in the CDFI Bond Guarantee

Program. Upon the closing of each bond, the eligible CDFIs have five years to lend or disburse

the bond proceeds.

The table below provides the year-to-date (YTD) and proposed disbursement for the top eight

asset classes.

Asset Class

YTD

Disbursements

($ millions)

YTD

Disbursements

(%)

Proposed

Disbursements

($millions)

Proposed

Disbursements

(%)

Charter schools $192.3 33.2% $346.6 25.4%

Rental housing $149.4 25.8% $334.2 24.5%

Commercial real estate $91.9 15.9% $269.9 19.8%

Financing Entity $72.3 12.5% $150.6 11.1%

Healthcare Facilities $29.8 5.15% $68.4 5.0%

Not-for-profits $29.0 5.0% $94.0 6.9%

Small business $8.3 1.4% $ 29.5 2.2%

Daycare centers $6.2 1.1% $ 28.5 2.1%

Performance Measure Changes

With the publication of Treasury’s Strategic Plan for FY 2018-2022, the CDFI Fund will work

this year to baseline the performance for the new strategic objectives. This could result in

changes to performance measures in the FY 2020 budget.

CDFI Fund - 17

Section III – Additional Information

A – Summary of Capital Investments

As part of its FY 2019 capital investment strategy, the CDFI Fund plans to spend approximately

$2.55 million for operations and maintenance of its Information Technology (IT). The CDFI

Fund has no major IT investments, nor any capital investments other than IT.

Non-Major IT Investments

For FY 2019, the CDFI Fund has identified two non-major IT investments: Awards Management

Information System (AMIS) and the CDFI Fund public website. AMIS is an enterprise-wide

commercial, cloud-based solution that supports CDFI Fund certification, tax credit allocation,

bond guarantee, and grant programs. The first AMIS deployment was implemented in

September 2015. Full deployment is planned for September 2018. The CDFI Fund public

website, which is another cloud-based solution, provides access to general information about the

CDFI Fund and is used to ensure the public can obtain information and guidance regarding CDFI

Fund programs. For FY 2019, the CDFI Fund plans to provide Operations and Maintenance

(O&M) support for these two IT investments.

IT Infrastructure Investments

The CDFI Fund’s IT infrastructure is managed via an Interagency Agreement with the Alcohol

and Tobacco Tax and Trade Bureau (TTB). Treasury has seen numerous benefits from the CDFI

Fund/TTB arrangement. It increases utilization of Treasury’s data centers and enables the CDFI

Fund to leverage existing Disaster Recovery and Continuity of Operations capabilities. The

CDFI Fund avoids software upgrade costs by using TTB’s enterprise software licenses. This

reduces duplicative services (such as Web monitoring and filtering) and eliminates contracts

used to maintain the CDFI Fund’s IT infrastructure.

A summary of the CDFI Fund’s capital investment resources, including major IT and non-

technology investments can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx